Cydene Energy CEO Skalid Obi tells NOAH BANJO about his experience running the business
What inspired by Cydene Energy?
The vision to establish the business was conceived when delivering a gas cylinder to my house. I thought it would be next to impossible for a company to effectively distribute liquefied petroleum gas to the market. More players were needed to build an efficient distribution network.
We wanted to give customers control of their energy needs so that they can access all the energy opportunities around them at their fingertips at very competitive prices. I thought that consumers should be able to plan and budget their energy consumption very easily and wisely thanks to our very flexible offers and services. Imagine having dedicated customer representatives just a click away, as is the case in banking and telecommunications. We have decided to fill these gaps for domestic and large-scale energy needs.
What is the orientation of the company and its subsidiary Cydene Express?
At first, we manage the distribution of petroleum products in the main African markets with a strong emphasis on retail. We import and distribute petroleum products to retail outlets across the country.
On the other hand, CEX is one of our end user retail offerings as part of an aggressive initiative to address distribution issues in Nigeria. We run a mobile algorithm that runs a network of trucks that offer cooking gas and diesel delivery services.
What problems does CEX solve and what impact would this have on the economy?
In the short term, we would stimulate the distribution of LPG. It would also result in a reduced cost of entry for skid operators, as the customer market has become structured, centralized and easily accessible via a mobile device. We’ve partnered with a few merchants to boost third-party products and services, such as locally made cylinders and utility bill payments. The ease of starting a business is at the heart of our concerns.
Technically, the basic know-how of using a mobile device is our biggest “enemy”. This is usually the longest part of the conversation. Once that’s sorted, everything else is just one click away. We have also partnered with banks and our payment processors to ensure transactions are safe and secure.
What are your expansion plans for the future?
At the moment, we are focusing a lot on local distribution. We admit that there is a very interesting market within the sub-Saharan region, but we would like to grow internally and then evolve as demand pulls.
We also have partnership proposals with third party suppliers. The idea is that our customers maintain one account for all of their energy needs. This is what guides our decisions for additional user services.
Given the capital intensive nature of the energy sector, what was your initial start-up capital and how did you raise the money?
It’s a very interesting story. At the time, it didn’t make sense to drive a sport utility vehicle without commercial capital. I had no one willing to give me products on credit. I then sold my SUV and bought a smaller car. I then used the money for my first delivery of 33,000 liters.
How would you describe your experience since you started running the business?
At the very beginning, we only had enough capital to fill a 33,000 liter gasoline truck. We started delivering at this rate — two trips per week and cash on delivery. Because we honored all of our delivery contracts on time, the brand started to gain momentum and we started receiving more orders. Finally, the suppliers started to offer us credit loadings, capitalizing on our period of turnover. Since then, it’s been slow and steady. Today, a large part of our customers pay even before delivery.
What strategy have you adopted to survive the pandemic?
We have adopted a lean structure in terms of operations, from reducing overheads to ensuring the comfort of employees when working from home. However, we have realized through the pandemic that the work environment does not always require an approach from the firefighters, but a subtle and more efficient way of creating sustainable solutions and a more efficient environment.
As an organization, we attach great importance to our employees and their well-being.
What advice do you give to future entrepreneurs?
Some time ago, in a meeting, Professor Anya Anya (renowned biology professor) told me and some of my colleagues. “If your vision is not a shared vision, it is a failed vision.”
Meanwhile, this is one aspect that I have struggled with in the past – making the vision a shared vision. It is easier to overcome obstacles when a team moves with the same goal in mind.
I generally encourage business “visionaries” to strive to get buy-in. They must first be convinced of their dreams and share these visions with people who can serve as a base of support. This way they can support the vision.
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